Energy efficiency can pay off on your taxes

Taxpayers take note: If you made energy efficiency improvements to your home in 2015, or if you are planning upgrades in 2016, you may be eligible for a federal tax credit of up to $500.

The Residential Energy Efficiency Tax Credit originally expired at the end of 2014. But Congress recently renewed the credit, making it retroactive to January 1, 2015, and extending it to December 31, 2016.

As a result, any qualified equipment installed in 2015 or 2016 is eligible for the credit. It applies to energy efficiency improvements to weatherize existing homes as well as the purchase of high-efficiency heating, cooling and water-heating equipment.

The maximum tax credit for all improvements made from 2011-2016 is $500. A taxpayer who has already claimed the full tax credit cannot apply for an additional credit.

A few examples of what may qualify for the tax credit:

Insulation materials and systems designed to reduce a home's heat loss or gain.

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